Correlation Between Walmart and Genesis Growth
Can any of the company-specific risk be diversified away by investing in both Walmart and Genesis Growth at the same time? Although using a correlation coefficient on its own may not help to predict future stock returns, this module helps to understand the diversifiable risk of combining Walmart and Genesis Growth into the same portfolio, which is an essential part of the fundamental portfolio management process.
By analyzing existing cross correlation between Walmart and Genesis Growth Tech, you can compare the effects of market volatilities on Walmart and Genesis Growth and check how they will diversify away market risk if combined in the same portfolio for a given time horizon. You can also utilize pair trading strategies of matching a long position in Walmart with a short position of Genesis Growth. Check out your portfolio center. Please also check ongoing floating volatility patterns of Walmart and Genesis Growth.
Diversification Opportunities for Walmart and Genesis Growth
0.77 | Correlation Coefficient |
Poor diversification
The 3 months correlation between Walmart and Genesis is 0.77. Overlapping area represents the amount of risk that can be diversified away by holding Walmart and Genesis Growth Tech in the same portfolio, assuming nothing else is changed. The correlation between historical prices or returns on Genesis Growth Tech and Walmart is a relative statistical measure of the degree to which these equity instruments tend to move together. The correlation coefficient measures the extent to which returns on Walmart are associated (or correlated) with Genesis Growth. Values of the correlation coefficient range from -1 to +1, where. The correlation of zero (0) is possible when the price movement of Genesis Growth Tech has no effect on the direction of Walmart i.e., Walmart and Genesis Growth go up and down completely randomly.
Pair Corralation between Walmart and Genesis Growth
If you would invest 8,170 in Walmart on August 30, 2024 and sell it today you would earn a total of 1,018 from holding Walmart or generate 12.46% return on investment over 90 days.
| Time Period | 3 Months [change] |
| Direction | Moves Together |
| Strength | Significant |
| Accuracy | 4.35% |
| Values | Daily Returns |
Walmart vs. Genesis Growth Tech
Performance |
| Timeline |
| Walmart |
| Genesis Growth Tech |
Risk-Adjusted Performance
0 of 100
Weak | Strong |
Very Weak
Walmart and Genesis Growth Volatility Contrast
Predicted Return Density |
| Returns |
Pair Trading with Walmart and Genesis Growth
The main advantage of trading using opposite Walmart and Genesis Growth positions is that it hedges away some unsystematic risk. Because of two separate transactions, even if Walmart position performs unexpectedly, Genesis Growth can make up some of the losses. Pair trading also minimizes risk from directional movements in the market. For example, if an entire industry or sector drops because of unexpected headlines, the short position in Genesis Growth will offset losses from the drop in Genesis Growth's long position.| Walmart vs. Weis Markets | Walmart vs. Ingles Markets Incorporated | Walmart vs. Sendas Distribuidora SA | Walmart vs. Grocery Outlet Holding |
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Check out your portfolio center.Note that this page's information should be used as a complementary analysis to find the right mix of equity instruments to add to your existing portfolios or create a brand new portfolio. You can also try the Price Exposure Probability module to analyze equity upside and downside potential for a given time horizon across multiple markets.
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